Retailers prepare for spending splash after tax cuts pass Parliament
Retailers are poised for a cash splash to rival Kevin Rudd’s $900 handout, after Parliament passed the $158bn tax cut package thanks to two SA senators and Jacqui Lambie.
- How two SA Senators took the power
- Lambie says she wants money for those ‘doing it tough’
- Lambie, Griff and Patrick to back tax cuts.
- Tax cuts pass Parliament — here’s how much you’ll get back
They are the unlikely voting bloc that has handed the Coalition its first big win for the 46th Parliament — a $158 billion tax package that was the centrepiece of its election campaign.
As revealed by The Advertiser yesterday, South Australian Centre Alliance senators Rex Patrick and Stirling Griff joined forces with Tasmanian independent Jacqui Lambie to help see the passage of the Tax Bill through the Parliament.
The business and retail sector have applauded the trio for supporting the package, saying it will create a strong economic stimulus. In SA more than 700,000 workers are set for a cash boost of up to $1080 from as early as next week.
An estimated 300,000 South Australians are expected to receive the full $1080, which totals more than $300 million in full payments alone.
Business SA spokesman Anthony Penney said the boost would get cash registers ringing with workers having more money in their pockets.
Mr Penney also commended the Centre Alliance senators for highlighting the cost of gas, which he said was particularly important for manufacturing businesses, which also needed support for gas efficiency measures.
Australian Retailers Association spokesman Russell Zimmerman compared the effect of the likely stimulus to Kevin Rudd’s $900 bonus cheque for more than eight million Australians in 2009. That cash splash often has been credited with protecting Australia from the worst of the Global Financial Crisis.
“If you look back to when Kevin Rudd gave the $900 to virtually every Australian a lot was spent in the retail sector,” Mr Zimmerman said
“Many people will spend this tax cut in the retail industry. It will come at a good time for many who will spend it on necessities like a new fridge or washing machine. Some of it will be spent on luxuries.”
PwC chief economist Jeremy Thorpe said “a majority of Australians are winners” from the latest package of tax cuts.
“Some will earn more than others,” he said. “Get your tax return in quick, because you will get paid quicker and that will help stimulate the economy which is one of the logics behind this.”
Mr Thorpe said the Reserve Bank of Australia was “really worried about the economy” resulting in the double cash rate cut in the past two months and the Government rolling out the tax cuts: “They are trying to put money into people’s pockets so they go and spend.”
Labor on Thursday night voted in favour of the full package in the Senate, after its amendments failed.
Opposition Leader Anthony Albanese said when it became impossible to get everything they wanted, Labor had to ensure money got in the hands of workers.
“We will review stage three closer to the next election and propose our own policies,” Mr Albanese said.
Senator Patrick said the minor party would continue to talk to the Government about lowering energy prices: “We’ve been working with the Government on sensible policies moving forward.”
Senator Lambie said her push to waive Tasmania’s housing debt was about doing what was right.
— with Sophie Elsworth
New gas deal in spotlight
Reducing domestic gas prices under Centre Alliance’s agreement with the Government has come under scrutiny.
Both parties yesterday rejected growing Opposition pressure to publicly release the government’s draft gas policy.
The gas industry’s peak body has also warned that market interventions could harm confidence in the sector, discourage new market entrants and affect diversity.